Chinese economy will overtake United States

Analysts say that by the end of 2014, China"s economy will surpass the economy of the United States and come on the first place in the world. This increase is caused by rising incomes.

Chinese economy will overtake United States

By the end of the year, China"s GDP at purchasing power parity will exceed that of the United States. It will exceed it by 0.2 trillion dollars. These data are important in assessing the economic condition of the state, but not always they can be considered correct and unambiguous. If we assume GDP PPP in dollars at current prices, the Chinese economy will be one and a half times weaker than the American one. Typically, these indicators are based on the International Comparison Program. Earlier, China"s economic growth was significantly stopped by low PPP indicator. And when this indicator went up, that fact became the engine of the economy. Alexey Maslov notes that the Chinese population now have big money which, in fact, they does not own. Such funds can be called fictitious. In the medium term, it could have bad impact on the economy and lead to a new wave of crisis.

In recent years, the economy of China has developed very dynamically. Not so long ago, in 2005, it amounted to less than half of the United States economy. Increasing purchasing power of the population helped China to make such a jump. At the moment, there is a slight slowdown in the Chinese economy. Also, the Chinese government must build economic plans with an eye to the resulting credit bubble. In the future, it could hit hard the global economy.

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